Botswana Diamonds Operational Presentation
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Transcript of Botswana Diamonds Operational Presentation
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Operational Update – August 2012
Operational Update – September 2012
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Disclaimer
The content of information contained in this Presentation has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000 (“FSMA”). Reliance upon this Presentation for the purpose of engaging in any investment activity may expose an individual to a significant risk of losing all of the property or other assets invested. If any person is in any doubt as to the contents of this Presentation, they should seek independent advice from a person who is authorised for the purposes of FSMA and who specialises in advising in investments of this kind. This Presentation is being supplied to you solely for your information.
While the information contained herein has been prepared in good faith, neither Botswana Diamonds (“Company”) nor its shareholders, directors, officers, agents, employees or advisers give, has given or has authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any interested party or its advisers and liability therefore is expressly disclaimed.
This Presentation does not constitute, or form part of, an admission document, listing particulars or a prospectus relating to the Company, nor does it constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company nor shall it or any part of it, or the fact of its distribution, form the basis of, or be relied upon in connection with, or act as any inducement to enter into any contract therefore.
Recipients of this Presentation who decide to subscribe for, or purchase, ordinary shares in the Company following the publication of the final document relating to the proposed Admission (the “Admission Document”) are reminded that any application so to subscribe for or purchase may only be made on the basis of the information contained in the Admission Document which may be different from the information contained in this Presentation and will contain additional information. No reliance may be placed for any purpose whatsoever on the information contained in this Presentation or on its completeness, accuracy or fairness thereof, nor is any responsibility accepted for any errors, misstatements in, or omission from, this Presentation or any direct or consequential loss however arising from any use of, or reliance on, this Presentation or otherwise in connection with it.
By accepting this Presentation you confirm, represent and warrant that you have consented to receive inside information (as defined in the Criminal Justice Act 1993 and the Financial Services and Markets Act 2000 (as amended) (the “Acts”)), and you agree not to deal in any securities of the Company until such time as such inside information has been made public and until such time that the Placing has been publicly announced by the Company or the Company decides not to proceed with the Placing.
This Presentation may not be reproduced or redistributed, in whole or in part, to any other person, or published, in whole or in part, for any purpose without the prior consent of the Company. The contents of this Presentation are confidential and are subject to updating, completion, revision, further verification and amendment without notice.
The Presentation is being distributed on request only to, and is directed at, authorised persons or exempt persons within the meaning of FSMA or any order made there under or to those persons falling within the following articles of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the “Financial Promotion Order”): Investment Professionals (as defined in Article 19(5)) and High Net Worth Companies (as defined in Article 49(2)). Persons who do not fall within any of these definitions should not rely on this Presentation nor take any action upon it but should return it immediately to the Company. This Presentation is exempt from the general restriction in section 21 of FSMA relating to the communication of invitations or inducements to engage in investment activity on the grounds that it is made only to certain categories of persons.
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Disclaimer
Neither this Presentation nor any copy of it should be distributed, directly or indirectly, by any means (including electronic transmission) to any persons with addresses in the United States of America (or any of its territories or possessions) (together, the “US”), Canada, Japan, Australia, the Republic of South Africa or the Republic of Ireland, or to any corporation, partnership or other entity created or organised under the laws thereof, or in any other country outside the United Kingdom where such distribution may lead to a breach of any legal or regulatory requirement. The recipients should inform themselves about and observe any such requirements or relationship.
The Company’s ordinary shares have not been, and are not expected to be, registered under the United States Securities Act 1933, as amended, (the “US Securities Act”) or under the securities laws of any other jurisdiction, and are not being offered or sold, directly or indirectly, within or into the US, Canada, Japan, Australia, the Republic of South Africa or the Republic of Ireland or to, or for the account or benefit of, any US persons or any national, citizen or resident of the US, Canada, Japan, Australia, the Republic of South Africa or the Republic of Ireland, unless such offer or sale would qualify for an exemption from registration under the US Securities Act and/or any other applicable securities laws.
Forward-looking Statements
This Presentation or documents referred to in it contain forward-looking statements. These statements relate to the future prospects developments and business strategies of the Company and its subsidiaries (the “Group”). Forward-looking statements are identified by the use of such terms as “believe”, “could”, “envisage”, “estimate”, “potential”, “intend”, “may”, “plan”, “will” or the negative of those, variations or comparable expressions, including references to assumptions. The forward-looking statements contained in this Presentation are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. If one or more of these risks or uncertainties materialises, or if underlying assumptions prove incorrect, the Group’s actual results may vary materially from those expected, estimated or projected. Given these risks and uncertainties, potential investors should not place any reliance on forward-looking statements. These forward-looking statements speak only as at the date of this Presentation.
No undertaking, representation, warranty or other assurance, expressed or implied, is made or given by or on behalf of the Company, any of their respective directors, officers, partners, employees or advisers or any other person as to the accuracy or the completeness of the information or opinions contained herein and to the extent permitted by law no responsibility or liability is accepted by any of them for any such information or opinions. Notwithstanding the aforesaid, nothing in this paragraph shall exclude liability for any representation or warranty made fraudulently.
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Executive Summary
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Company Synopsis
Botswana Diamonds (BOD) is an AIM and Botswana listed company with
exploration/development projects located in the best diamond address in
the world
JV with “diamond major” in Botswana
Significant upside in Mobilong exploration licence in Cameroon -
Diamonds found. Potential projects in Zimbabwe and elsewhere
Experienced management team which previously sold African Diamonds’s
AK6 kimberlite project to Lucara for c.$100 million
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Company Snapshot
AIM listed diamond explorer focussed on projects in Botswana, Cameroon and Zimbabwe
Experienced management team looking to emulate their success with African Diamonds
Exciting prospects in the right areas with encouraging results
Share Price – 1 Year
Significant Shareholders Corporate Information
Shareholders who hold more than 3% % Holding
Rene Nominees 10.47
John James Teeling 9.89
HSBC Global Cust Nom Ltd 7.36
WB Nominees Ltd 6.41
James Finn 3.59
TD Waterhouse Nominees (Europe) Ltd
3.32
Exchanges AIM (LSE)
Ticker BOD
Shares in Issue 138m
Market Cap 5.53
Share price 4
Cash position $1 m
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Management team - Pedigree and Experience
John Teeling - Executive Chairman 40 years’ experience in mineral exploration. Founder of African Diamonds, sold
to Lucara Diamonds Corp for c. $100 million in 2010.
Jim Finn - Director 20 years’ resource company experience. Holds qualifications in finance and
accounting. A director of a number of resource and industrial ventures. Has led the listing procedure for ten AIM companies.
David Horgan - Director He is Managing Director of AIM listed oil explorer Petrel Resources plc and
Clontarf Energy plc. Holds a Law degree from Cambridge and an MBA from Harvard.
Robert Bouquet - Director 18 years' experience in diamond industry, 14 of which with De Beers and Rio
Tinto Diamonds in a variety of strategic and commercial roles. Experience in diamond producer countries, particularly in Africa as well as in all
diamond cutting centres.
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Company Strategy
Secure high potential ground/projects in world
renowned diamond provinces.
Take advantage of existing geological knowledge and
data.
Utilise Joint Venture’s to maximise project potential and value to shareholders.
Use our expertise in paleoplacers to explore new
opportunities.
Shareholder Value
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The right areas...
CAMEROON
Paleoplacer deposit discovered. Three diamonds discovered so far in initial bulk sampling.
BOTSWANA
Active 50/50 JV with a major using new technology to identify large diamondiferious kimberlites in the Orapa area.
A highly prospective 262 sq. km exploration licence owned 100% by BOD – 5 high potential targets identified.
ZIMBABWE
A Production Sharing Agreement with a local group over a 4,000 hectare concession in Chimanimani.
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...the right properties...
Location Licences
Structure Size Renewal Date
Latest News
Botswana – Orapa
1 100% BoD 262 sq km May – 15 12 targets identified; 5 high potential , to proceed to percussion drilling.
Botswana (JV) – NE
Up to 11
JV NA Under application
Targets identified and applications for licences submitted.
Cameroon – Libongo
1 85% 484 sq km Aug – 15 Bulk sampling ongoing, diamonds found on the block.
Zimbabwe – Chimanimani
1 PSA; NA Pending Initial feasibility study undergone regarding the prospectivity of the area.
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…at the right time
Diamonds considered a late
economic development commodity
Emerging markets will drive growth
Prices remain at historically strong
levels
Industry structural changes
underway
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Areas of Operation and Portfolio
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Botswana: The Best Address in Diamonds
Botswana, the Switzerland of Africa
Largest diamond producer by value in the world.
Botswana Diamonds management established African Diamonds in 2002
Discovered the Karowe mine, one million carats a year, including high value Type 2 in Orapa
The company was sold to Lucara (TSX: LUC) in December 2010
Source: Lucara
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Botswana PL170/2012 Kaapvaal Craton
Highly prospective 262 sq km block awarded in May 2012
Part of the Orapa kimberlite cluster
On the Kaapvaal craton with up to 60m of sand
De Beers explored lightly but ineffectively
Modern techniques are more precise
High resolution geophysics completed; five highly prospective opportunities identified
Percussion drilling to commence
Geology similar Gope Mine of Gem Diamonds and the recent Petra discovery X36
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Botswana: Joint Venture
JV with diamond major. The major holds a proven technology which will be used in Botswana for the first time;
― Initial area of interest – NW territory of Botswana
― New approach to traditional areas
― Significant upside in difficult, underexplored areas
Secondary analysis and targeting followed by prospecting
Geophysical data has being processed. Geochemical data collection completed
Full results due Qtr 4 2012. Initial results indicate a number of attractive areas
Applications for concessions in the identified area has commenced.
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Botswana - Areas of Joint Venture Interest
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Cameroon: Mobilong Diamondfields
New paleo-conglomerate diamond field
emerging in east Cameroon
CNK Mining (Korean) are constructing a
1 million carat p.a. mine in Mobilong
adjacent to BOD licence
480sq km of Exploration Licence - Terms
are 4 years with renewals
CNK Licence
Area
BOD Licence
Area
Initial Area of Focus
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Cameroon: Libongo Licence
Several outcrops of paleo-
conglomerate identified
Three diamonds already found, helping
to confirm value of the resource
Evidence of artisanal workings in area;
Three 100 tonne bulk samples are
being analysed to confirm presence of
diamonds
An evaluation to be undertaken on
whether economic
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Zimbabwe: Emerging Diamond Powerhouse
It is likely that Zimbabwe will be
among the top diamond
producers
Political uncertainty
Sanctions apply to many diamond
operators
BOD holds kimberlite concessions
and has a PSA with the holders of
a licence in Chimanimani
Project Areas
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Summary
Expert management team with previous track
record in successful diamond exploration
Operating in the right areas
Positive initial results
Working towards JVs to de-risk projects
Sufficient cash for near-term exploration
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Contact Details
162 Clontarf Road Clontarf Dublin 3
Ph: +353 1833 2833 Web: www.botswanadiamondsplc.com
www.botswanadiamonds.co.uk Email: [email protected]
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Appendix - Diamond Market
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Appendix: Diamond Market
22 Source: Bain report, December 2011
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Appendix: Diamond Market
23 Source: Bain report, December 2011
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Appendix: Diamond Market
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Source: Bain report, December 2011 Source: RBC Capital Markets, September 2010
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Appendix - Diamond Source
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Crudely concentric structure
Crust
Solid lower and upper mantle
Liquid outer core
Solid inner core
Appendix: Evolution of the Earth
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Appendix: Eruption Of A Kimberlite Volcano
27 of 27
Crater
Diatreme
Xenoliths
Root
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Appendix: Diamondiferous Kimberlites
mobile belt craton
lithosphere
diamond stability zone
29 29 of 27
Appendix: Diamond Deposits
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Appendix: Global Diamond Deposits